Salesforce Inc (CRM) — Q3 2025 Earnings Call Transcript

Thanks, Regina. Good afternoon and thanks for joining us today on our Fiscal 2025 Third Quarter Results Conference Call. Our press release, SEC filings, and a replay of today's call can be found on our website. Joining me on the call today is Marc Benioff, Chair and CEO; Amy Weaver, President and Chief Financial Officer; and Brian Millham, President and Chief Operating Officer. As a reminder, our commentary today will include non-GAAP measures. Reconciliations between our GAAP and non-GAAP results and guidance can be found in our earnings materials and press release. Some of our comments today may contain forward-looking statements that are subject to risks, uncertainties, and assumptions, which could change. Should any of these risks materialize or should our assumptions prove to be incorrect, actual company results could differ materially from these forward-looking statements. A description of these risks and uncertainties, and assumptions and other factors that could affect our financial results is included in our SEC filings, including our most recent report on Forms 10-K, 10-Q, and any other SEC filings. Except as required by law, we do not undertake any responsibility to update these forward-looking statements. And with that, let me hand the call over to Marc.

Thank you, Mike, and I appreciate everyone being on the call today. We have a lot of exciting topics to cover, and I hope you enjoyed your Thanksgiving. We're thrilled about the quarter's results, which showed strong revenue performance, operating margin, cRPO, and cash flow. However, it's not just the numbers that we find exciting at Salesforce. While the financials are impressive, the real interest lies in the advancements in our technology. I’m eager to discuss that with you. Before diving in, let's reflect on the significant financial transformation we've experienced over the past few years. Brian and Amy will elaborate on how we are redefining success and delivering financial value for our customers while achieving remarkable outcomes. This is about more than just another successful quarter; we are on the brink of a revolutionary transformation. We are witnessing the emergence of digital labor. For the last 25 years, Salesforce has assisted companies in managing and sharing information, evident across our product line in sales, service, marketing, commerce, and more. Recently, we've created a brand-new market—the market for digital labor—which is much more expansive and exciting than the data management market. Salesforce is now the leading provider of digital labor, and this is merely the beginning, powered by autonomous AI agents. This development is fundamentally altering how businesses function and how we view our industry. With Agentforce, we are not just envisioning the future but actively delivering it. Last week, Agentforce went into production, and we secured 200 deals, with an impressive pipeline for future transactions. The momentum is unlike anything we’ve ever seen, representing a shift where productivity is no longer reliant on workforce growth but rather on intelligent technology that scales without limits. Agentforce signifies the next evolution of Salesforce, where AI agents collaborate with humans, enhancing their capabilities and delivering unparalleled speed. We’ve already implemented this technology across our entire support organization, establishing a robust agentic layer throughout the company. This sets the stage for a complete digital transformation worldwide, where robots will soon work alongside humans. The impact of this transformation is already evident. These agents are not mere tools; they are collaborators, operational 24/7 to analyze data, make decisions, and take action. Imagine enterprises able to manage millions of customer interactions daily, with Agentforce resolving issues, processing transactions, and anticipating customer needs, allowing humans to concentrate on strategic initiatives and building meaningful relationships. Companies like large hospitals or hotels will benefit from agents and robots working side by side, delivering a glimpse of a future that is already unfolding. With Agentforce, we’re paving the way for a new era of digital labor across all industries. The implications are profound. Economic growth has traditionally relied on expanding the human workforce, but as labor stagnates globally, Agentforce opens a new path forward, blending scale and efficiency for our customers. They are already experiencing this evolution, with Agentforce managing service cases, resolving issues, processing leads, and optimizing marketing campaigns at an unprecedented scale, 24/7. During Dreamforce, we witnessed a strong demand from our customers, who built over 10,000 agents in just three days. Since then, we've continued our world tour, generating thousands more agents globally, empowering customers to engage with the technology and envision its potential for their organizations. The demand for Agentforce has skyrocketed since its availability on October 24th, culminating in over 200 deals in Q3 alone, with thousands already in the pipeline. Prominent companies like FedEx, Adecco, Accenture, and IBM are now constructing their digital labor forces on the Salesforce platform with Agentforce. This positions Salesforce as a leader in delivering enterprise solutions at scale across various industries. We are immensely proud of our teams who have brought this to market first. We are not only prepared for an agent-first future; we are at the forefront of it for our customers. Agentforce is now live on help.salesforce.com, where you can witness its capabilities. We're also testing an agent at the forefront of our website for US customers to explore its potential. This portal is our primary support mechanism, handling over 60 million sessions and more than 2 million support cases yearly, all powered by Agentforce. This will have significant implications for our company, enabling us to shift our workforce toward growth areas like distribution, where we strive to hire thousands of additional salespeople to take advantage of this unique opportunity. Agentforce transcends the functionality of legacy chatbots, unlocking a new level of operational efficiency and digital intelligence at massive scale. Using help.salesforce.com as an authenticated user will reveal its accuracy and responsiveness, mitigating common issues we see elsewhere. With access to 740,000 documents in 17 languages and customer-specific data, Agentforce has a distinct advantage in delivering precise answers quickly. By being built on our platform, Agentforce can reason over vast amounts of data, offering personalized responses with citations, and it can seamlessly transition to support engineers with complete summaries and recommendations included. This is not a vision for the future; it’s reality today. In contrast to other companies claiming to deliver enterprise AI, Salesforce can operate entirely on our platform, something that is not evident on Microsoft’s site. We anticipate that Agentforce will reduce our annual case volume significantly, with many customers already realizing its transformative potential. For example, Vivint, a home security provider, faced challenges with high support call volumes and turnover but is now leveraging Agentforce to create a digital support team addressing diverse issues across customer touchpoints and automating tasks like technician scheduling. Similarly, Adecco, which manages 300 million job applications annually, will utilize Agentforce to efficiently sort resumes and pre-qualify candidates, transforming their hiring process and assisting applicants in refining their submissions. Our discussions over the past couple of years have highlighted Salesforce's unique advantage in AI due to our expansive data capabilities. We are indeed the leading supplier of enterprise AI globally, processing 2 trillion Einstein transactions per week, and now we are combining this with the remarkable capabilities of Agentforce. This represents a significant shift in how we interact with customers and work. College Possible, a nonprofit, is one example of how Agentforce can deploy a virtual counselor swiftly to improve access for students who have historically faced challenges in obtaining necessary guidance. Our 135,000 customers are already equipped with Agentforce, enabling them to enhance their operations and customer interactions seamlessly. We have invested heavily in unifying our applications on a single core platform that emphasizes security and workflow efficiency. This effort ensures our diverse functionalities are integrated within a single codebase, distinctly positioning Salesforce in the market. The introduction of this agentic layer, built on these foundational investments, uniquely differentiates our enterprise solutions. We acknowledge the responsibility that comes with such extraordinary technology. Trust is a core value at Salesforce, and it's more crucial than ever as we navigate this innovative era. We are dedicated to developing Agentforce with fairness and accountability while empowering our customers with the necessary tools to thrive in an AI-driven economy. As we adapt, the workforce will need to evolve. History shows that disruption opens doors to new opportunities. Customers are already targeting efficiency improvements through AI, highlighting the transformative potential that lies ahead. The landscape will radically change with these advancements, encompassing robots, data utilization, and the pioneering technology we’ve developed over recent decades. This is not merely a technological evolution; it’s a chance to create a better collective future. With Agentforce, we are leading this journey into a new horizon of digital labor. We're excited to extend this vision further. Although we just introduced Agentforce, we invite you to the launch of Agentforce 2.0 on December 17th in San Francisco. You won’t want to miss this as we showcase advancements in technology that enhance accuracy and value. Now, I’ll hand things over to Brian.

Hey, thanks, Marc. Really appreciate it. I've been at Salesforce almost as long as Marc and Parker and this is the most exciting time in my career. As a company, we redefined enterprise software with cloud, social, mobile, and predictive AI over the past 25 years and now we're doing it again with Agentforce. As Marc said, this is the beginning of a revolutionary transformation that will fundamentally redefine how we work and how work gets done. Our strong results in the quarter reflect the trust our customers, partners, and stakeholders have in Salesforce to lead them into this new agent-first world. We made great progress in the quarter against Salesforce growth pillars, first and foremost with Agentforce and Data Cloud, but also with our multicloud deals, international expansion, industry solutions and our ecosystem. Agentforce will enable companies to achieve a new era of abundance with more efficiency, more productivity, even stronger customer relationships, higher margins and higher revenues across every industry. It's a new technology model and a new business model, and we've built a complete agent-first platform for customers that will save them millions of dollars and provide them with limitless workforces to drive greater value. Companies like Remarkable and Wiley are already seeing incredible results. Wiley, an early adopter, is resolving cases over 40% faster with Agentforce than their previous chatbot. Heathrow Airport, one of the busiest airports in the world, will be able to respond to thousands of travelers' inquiries instantly, accurately, and simultaneously. SharkNinja, a new logo in the quarter, chose Agentforce and Commerce Cloud to deliver 24x7 personalized support for customers across 28 international markets and unifying its service operations. Our customer success with Agentforce and our AI solutions is driving strong results. In Q3, the number of wins greater than $1 million with AI more than tripled year-over-year and we signed more than 2,000 AI deals, including more than the 200 Agentforce wins that Marc shared. To capture this increased demand for Agentforce, we're hiring 1,400 AEs globally in our fourth quarter and we're also using new sales SDR agent and sales coaching agent to augment every seller. We're also seeing amazing Agentforce energy across the ecosystem with our global partners involved in 75% of our Q3 Agentforce deals in nine of our top 10 wins in the quarter. Over 80,000 system integrators have completed Agentforce training, and hundreds of ISVs and technology partners are building and selling agents. And our partners are also becoming agent-first enterprises themselves. In the quarter, Accenture chose Agentforce's streamlined sales operations and enhanced bid management for its 52,000 global sellers. By integrating sales coach and custom AI agents, Agentforce is improving deal quality and targeting a 75% boost in bid coverage. We see an incredible future with Agentforce, not only for our customers, but also for us. As customer zero, we can leverage Agentforce ourselves to realize the benefits of digital labor for us to amplify and augment our human workforce. Marc talked about how we've reimagined Salesforce customer service with Agentforce; while we're also deploying Agentforce to engage our prospects on Salesforce.com, answering their questions 24/7 as well as handing them off to our SDR team. You can see it for yourself and test it out on our homepage. We'll use our new Agentforce SDR agent to further automate top-of-funnel activities from gathering leads, lead data for providing education and qualifying prospects and booking meetings. Initiatives like this and many others means Salesforce will become a new lever for productivity, growth, and efficiency for Salesforce, which should save millions of hours and free up hundreds of millions of dollars to reinvest into our strategic growth initiatives. Becoming an agent-first enterprise starts with having unified data. That's why we continue to see amazing momentum with Data Cloud, which was included in eight of our top 10 wins in the quarter. Today, 25% of the Fortune 100 are Data Cloud customers. Marc mentioned the Adecco Group; they're centralizing more than 40 instances in legacy systems with Data Cloud to build a foundation to implement Agentforce at scale. Usage is a key indicator for our product's value to our customers and our customers are now processing 767 trillion records every month. Indeed, the world's leading job site hires three people every second on its platform. Using Data Cloud as its go-to-market data architecture, Indeed matches 580 million job seeker profiles with over 3 million employers. With Agentforce, Indeed aims to have time to hire and help 3 million people overcome employment barriers by 2030. IBM, one of our valued strategic partners, selected Data Cloud in the quarter to enhance their global client service with a unified view of all client interactions and actionable consumption insights to deliver even more efficient personalized experiences. Proprietary unstructured data is a powerful fuel for AI and we're excited that we were able to close the acquisition of Zoomin to accelerate and unlock the unstructured data to power AI agents, making them more personalized and context-aware for every customer interaction. We also finalized our acquisition of the Own Company. Own's data management capabilities complement our existing offerings and will strengthen data security, privacy, and compliance across our platform. As Marc described, Agentforce is a gamechanger for our core products, enabling customers to leverage AI-powered insights and actions directly in the flow of work across our entire product portfolio. This is evidenced by the strong demand for Sales Cloud and Service Cloud, both of which achieved double-digit growth in Q3. We also just wrapped up another incredible Cyber Week, during which Commerce Cloud powered close to 50 million orders on digital storefronts with nearly 100% uptime. Salesforce powered nearly 60 billion AI-powered product recommendations, a 21% increase year-over-year, and over 56 billion marketing messages were sent via Marketing Cloud. Service Cloud also helped our customers field and resolve 3.8 billion cases. Clearly, the scale, reliability, and intelligence of our integrated platform is unmatched. And we continue to see solid momentum with Slack with wins at Capital One, SNAP, Rivian, and Volkswagen Group Technology. Annual spend on Slack AI grew nearly 50% quarter-over-quarter, and Slack was included in more than a third of our deals greater than $1 million. Since the release of Slack AI, our customers have summarized over 600 million messages, saving them a collective 1.1 million hours. Tableau and MuleSoft continue to be foundational and fundamental to our customers' transformations. In the quarter, Tableau had wins at Allegis, SiriusXM, and Hitachi, and MuleSoft had wins at Northwell Health, 3M, and CalOptima Health. Our industry clouds continue to fuel our growth with strong demand in highly regulated industries like healthcare; notably, our new agent-first Life Science Cloud was in three of our top 10 deals in the quarter. We also saw strong momentum internationally with wins at Brenntag and Finnair; once again, half of our top 10 wins for the quarter were international. We continue to unlock customer spend through new channels, including the Agentforce partner network that launched at Dreamforce, which allows customers to customize and deploy specialized agents using trusted third-party extensions from Salesforce AppExchange. And AWS Marketplace continues to be a growth driver. Our Q3 transactions doubled quarter-over-quarter with 10 deals exceeding $1 million. Salesforce's business and financial performance has delivered unprecedented results and we're doing it again with our product transformation and Agentforce. We're starting Q4 with strong momentum and no one is better positioned to capture the massive Agentforce opportunity ahead.

Great. Thanks, Brian. As you heard from Marc and Brian, we are incredibly excited about the opportunity ahead with Agentforce. To simply put, Salesforce is uniquely positioned to become the leading enterprise AI platform and the source of a digital workforce for companies around the globe. And as customer zero for Agentforce, we're already seeing a significant pickup in case deflections for our customer service organizations. This is just the beginning of a new world of humans and AI agents working together to fundamentally reshape the economics of business. As Marc mentioned, we've been on a financial transformation over the past several years and you'll see it in our results. Q3 represents another quarter of focused execution leading to strong outcomes. Q3 revenue was $9.44 billion, up 8% year-over-year in nominal and constant currency, driven by resilience in our core clouds. Subscription and support revenue grew 9% year-over-year in nominal and constant currency, led by another quarter of double-digit growth in both sales and service, driven by strong ARPU growth. As expected, this was partially offset by deceleration in our license revenue growth in MuleSoft and Tableau in Q3 on tough prior-year compares. From a geographic perspective, Americas revenue grew 6% in nominal and constant currency, EMEA grew 12% or 9% in constant currency and APAC grew 16% or 14% in constant currency. We saw strong new business growth in LatAm, Canada, and Australia, while the United States and parts of EMEA remained constrained. From an industry perspective, in Q3, health and life sciences, manufacturing, automotive, and energy all performed well, while retail and consumer goods were more measured. Our multi-cloud momentum continues with our top-25 deals averaging more than five clouds each. Now you hear us talk about this metric every quarter. It's an incredible proof point that our customers trust Salesforce to transform their entire customer experience from sales to service to marketing and commerce to analytics and integration. But our multi-cloud strategy is also core to our financial strategy. Multi-cloud customers have higher spend, lower attrition rates, and drive significant ARR expansion for us each quarter. That's because Salesforce is the only company that can deliver a 360-degree view of your customers, which is essential for every company as we move into an agent-first world. Data Cloud also continues to be the foundation for every AI transformation and it was included in one-third of all of our deals this quarter over $1 million. As you heard from Brian, Data Cloud helps unlock AI with our customers. And that's why eight of our top 10 deals included both Data Cloud and AI, inclusive of Agentforce. This is really the model for all future transactions. Q3 revenue attrition ended the quarter slightly above 8%, in line with recent quarters. Q3 non-GAAP operating margin was 33.1%, up 190 basis points year-over-year, driven by top-line outperformance and disciplined expense management. And I am very pleased to share that this quarter, our GAAP operating margin hit 20% for the first time in company history. Q3 non-GAAP EPS was $2.41, inclusive of a $0.18 charge driven by mark-to-market adjustments of our strategic investments portfolio. Excluding this impact, non-GAAP EPS would have been $2.59, well ahead of our guidance. Q3 operating cash flow was $2 billion, up 29% year-over-year. Q3 free cash flow was $1.8 billion, up 30% year-over-year. Turning to remaining performance obligations. RPO, which represents all future revenue under contract, ended Q3 at $53.1 billion, up 10% year-over-year. Current RPO or cRPO, ended at $26.4 billion, an increase of slightly more than 10% year-over-year in nominal currency. This includes a $100 million FX tailwind, which results in 10% year-over-year growth in constant currency. cRPO outperformance was driven by early renewal favorability and strong new bookings performance. Of note, on the bookings performance, over the past couple of quarters, we have seen stabilization in our transactional businesses, most notably Create and Close and SMB. One call out on the Q3 cRPO results. As you heard from Marc, Agentforce's momentum in Q3 was incredible with over 200 deals closed in only one week. However, given we are early in our adoption cycle, it is not yet a material contributor to cRPO. On capital return, in Q3, we executed $1.2 billion in share repurchases and paid nearly $400 million in dividends. This brings our total return to shareholders in the quarter to $1.6 billion. Through our capital return program, we continue to expect to more than fully offset dilution from our FY'25 stock-based compensation. And I'm pleased to share that since inception of our capital allocation program, total capital returns have now surpassed $20 billion. Now let's turn to guidance. Note that after the end of our third quarter, we closed our acquisitions of the Own Company and Zoomin. As such, our guidance incorporates contributions from both these deals. Let's start with the full fiscal year '25. On revenue, we are raising the low end of our guidance range to $37.8 billion and maintaining the high end at $38 billion, growth of approximately 8% to 9% year-over-year, reflecting the strong execution and revenue outperformance over the last two quarters. For subscription and support revenue, we still expect approximately 10% growth year-over-year in constant currency. A few reminders on our revenue guide. On FX, our revenue guidance continues to incorporate a $100 million FX headwind year-over-year or a 30 basis-point impact. We continue to expect our professional services business to be a headwind to revenue growth. And as we shared last quarter, our guidance incorporates deceleration in our license revenue growth in the back half of this year. On attrition, we expect attrition to remain consistent at slightly above 8% for the full year. Now turning to profitability and cash flow. On margins, we are pleased to raise our fiscal year '25 non-GAAP operating margin guidance to 32.9%, representing a 240 basis point improvement year-over-year. This incorporates intentional investments in growth opportunities, most notably in Agentforce and Data Cloud. As we said last quarter, stock-based compensation is still expected to be approximately 8.4% as a percent of revenue. For fiscal year '25, GAAP operating margin guidance continues to be slightly below 20%, representing 540 basis points of improvement year-over-year. We expect fiscal year '25 GAAP diluted EPS of $6.15 to $6.20. Non-GAAP diluted EPS is expected to be $9.98 to $10.03. We are raising our fiscal year '25 operating cash flow growth to approximately 24% to 26%, inclusive of cash tax headwinds. And we continue to expect CapEx for the fiscal year to be slightly below 2% of revenue. This now results in free cash flow growth of approximately 26% to 28% for the fiscal year. Now to guidance for Q4. On revenue, we expect $9.9 billion to $10.1 billion, up 7% to 9% year-over-year in nominal and constant currency. cRPO growth for Q4 is expected to be approximately 9% year-over-year in nominal, including a $100 million FX headwind and slightly above 9% in constant currency. Similar to Q3, we do not expect a material contribution to cRPO from Q4 Agentforce-related bookings. For Q4, we expect GAAP EPS of $1.55 to $1.60 and non-GAAP EPS of $2.57 to $2.62. In closing, I am very pleased with our strong execution this quarter and we remain focused on driving profitable growth, optimizing free cash flow, and delivering a new era of customer success with Agentforce, which truly represents the next evolution of Salesforce.

Thanks, Amy. As a courtesy to everyone on the call, we ask that everyone only ask one question, please. With that, Regina, let's go to the first question, please.

Hi. Good afternoon, Marc. On Agentforce, I'm curious if you could just talk about the halo effect you're starting to see across the product lines, perhaps some of the other products getting pulled in. You mentioned Data Cloud, can you speak to what you're seeing from that? Thank you.

Brent, thanks for the question. Amy really highlighted an important point in her remarks that deserves more attention. In our top 25 deals, we experienced collaboration with five different cloud services. This indicates that our most significant clients are increasingly adopting our comprehensive agent-first approach. Our offerings—sales, service, marketing, analytics, data cloud, and Slack—are what customers want and need together. Our Sales Cloud is the leading solution in the world, and it stands out as the only agent-first Sales Cloud available today. We also have the top-ranked Service Cloud globally, and Gartner's recent Magic Quadrant confirms our top position, where we've made further advancements as the only agent-first Service Cloud, Marketing Cloud, Analytics, Data, and Slack available. I’d like to share a story about a notable customer in the healthcare sector. They recently reached out, considering how to deploy these agents effectively, presenting a significant opportunity in healthcare. After our detailed presentation, they contacted us the following day to discuss their Marketing Cloud options, comparing us with Adobe. I suggested involving our team to showcase our offerings more holistically, emphasizing our powerful Marketing Cloud capabilities, including email and promotional functions integrated into our workflow. They saw the value in how everything operates across all customer channels and touchpoints in our comprehensive customer suite. Subsequently, they confirmed they would also work with us on marketing. When clients recognize their intention to develop agent-first companies, they understand the necessity for agents to access the full spectrum of our dataset and metadata. We are unique in having built an all-encompassing platform that integrates Sales, Service, Marketing, Analytics, Data Cloud, and Slack seamlessly, capable of scaling for any business size, from small firms to the largest corporations globally, which sets Salesforce apart. We currently possess something exceptional because, as you know, I've been in the industry for a long time, and we consistently offer the best enterprise AI. Einstein, our AI solution, has been developed over a decade, allowing us to enhance our capabilities for agent-first applications. This integration within the platform means that everything operates cohesively, without requiring separate code, providing customers with full functionality effortlessly. I couldn't be more enthusiastic about this progress. It's truly a remarkable moment, and I believe it’s evident throughout this discussion. Reflecting on how long we've collaborated, the dialogue we've had on this earnings call is unlike any previous discussions about software. We are on the brink of learning, growing, and evolving into a new industry that delivers unparalleled value, and this is the most excited I have ever been about the software landscape.

Thanks, Brent. Regina, we'll take the next question, please.

Excellent. Thank you guys for taking the question and definitely hear the excitement coming through on the call. Maybe a question for Brian. When it comes to those 200 deals that you've already signed for Agentforce, maybe you could give us some color on what those deals look like? Do they tend to be upsells? What type of uplift do you see if you're upselling into customers? Do they tend towards like one cloud or another? How expansive are there? Any kind of color that we can use to try to kind of understand this opportunity better?

Yeah, Keith, thank you for the question and a good one. We are seeing incredible traction with our customers as add-ons to many of our Service Cloud offerings. Obviously, you know Service Cloud is our largest cloud and our initial Agentforce opportunity is with our Service Cloud customers right now and we saw a ton of add-ons happening in our customer base with Service Cloud. But what our customers also recognize is that this is a platform. And the opportunity to move from, yes, of course, we want to have autonomous agents that are supporting customers like we have on help.salesforce.com, but what are all the opportunities you have in your interactions and the flow of work with your customers where you can deploy agents. And so while we have tremendous excitement in the initial 200 deals, we're largely in the Service Cloud space, we feel great about the opportunity with Sales Cloud and with Marketing Cloud and with Commerce Cloud and of course with Data Cloud, which is included in all of our Agentforce deals. And so those 200 deals, sort of, tip of the iceberg when we think about the opportunity that's ahead of us for Agentforce.

Thanks, Keith. Regina, we'll take the next question, please.

Perfect. Thank you. You're obviously creating a lot of value for your clients. Like how is the discussion about how you kind of participate or work with the clients about pricing for Agentforce going or like how should we think about it? What are you hearing there? Thank you.

Raimo, thanks for the question. I'll start and I think Marc is probably going to chime in as well. But we were super excited about. And I would say, as you all know, it's a usage-based structure and at $2 a conversation, we feel like the value is very high for our customers given what they're spending today in a lot of their conversations, please.

I've been wearing a boot after rupturing my Achilles on a scuba diving trip to Fakarava, an amazing location in French Polynesia where I celebrated my birthday. While I enjoyed my time there, I unfortunately injured myself. I recently received a call from my hospital to schedule another MRI, and I must say, their service is impressive. I have a strong relationship with UCSF, where they take great care of me, and I appreciate their attention to detail. They had numerous questions to prepare me for my upcoming MRI, and during the call, I reflected on the costs involved. UCSF is facing a staffing shortage, and both doctors and nurses are overwhelmed. Many of them are working late into the night just to manage their workloads. It's remarkable how much they accomplish despite their limited staff. While on the call, I realized they already had all my data, including my medical history and scans. An agent could have handled that call, which likely cost the hospital around $100, while we could have done it for about $1.50. This highlights the message for our clients about relieving some of their staff to focus on strategic priorities, rather than on administrative tasks that higher levels could efficiently delegate elsewhere. We're at a pivotal point for enhancing productivity and increasing GDP without a need for more hires, exemplified by the hospital situation. Consumption pricing is familiar to Salesforce, as seen with our various products. We offer per-user products for human users and consumption products aimed at agents and automation. The cost comparisons clearly favor our approach. Brian, would you like to expand on that?

Yeah, I'd just say, our customers really understand the cost of their labor right now. And when we can deploy agents to help them manage their interactions with their customers, the pricing conversations are significantly easier. And so you can even see it on our website. We've got calculators that allow our customers to go do the work themselves and it's been a great ad for them to go understand what the cost structures look like and it's been an enlightenment for many of our customers to see the value that we can deliver for them with Agentforce.

Great. Thanks, Raimo. Regina, we'll go to the next question, please.

Great. Thanks so much for taking the question. Marc, I wanted to ask about the more core initiative that you mentioned in your remarks. It would seem further integrating the platform can only be a good thing for customers. Can you talk more about what's involved and the size of the price as you come out the other side of this initiative? Thanks.

We have been working on this for a couple of years since we began our transformation, which I believe we are celebrating the second anniversary of today. It was around two years ago that we realized we were about to undergo a significant transformation, and we wouldn't have successfully navigated it without your support. You provided us with valuable insights and strategies, and it's been an incredible journey over the past 24 months, marked by both financial and technological changes. Our focus has been on strengthening our organization to achieve our desired results and to expand our distribution network, something we wish we had accelerated. We have made substantial investments in AI, as evident in Agentforce, and we've put considerable resources into More Core. Over these two years, we've significantly boosted productivity and increased the number of engineers at the company, which has been a key focus for us. This progress has enabled us to enhance our technological capabilities. For instance, at Dreamforce, you saw how commerce and marketing, which were once separate from the core platform, are now integrated. Our goal is to have Sales, Service, Marketing, Analytics, Data Cloud, and Slack all within one platform. This integration ensures that all workflows, data, and metadata are consolidated, making effective AI operations possible. AI relies on the ability to analyze vast datasets and functions seamlessly. Imagine a scenario where I am speaking with UCSF, and at some point in the future, I connect to a different agent who tells me that I owe $500 from a previous visit, which is not unusual for me. I could simply say to process that payment, and that would all occur on our platform. Commerce, email confirmations, case management, and patient relationship management can all be handled on the same platform, tailored by industry, geography, and currency. This comprehensive functionality is what sets Salesforce apart; we are not just providing an agent-first solution but a complete ecosystem working together.

Great. Thanks, Brad. Regina, we'll take our last question now, please.

Yes, thanks very much. Congrats on the quarter and great to hear all the excitement around Agentforce off the launch. Brian, this is probably for you. I was just curious and dovetails back into some earlier comments. Really strong attach with Data Cloud thus far. I was just kind of curious how far along are your customers in terms of having their data in order so that they can get value from Agentforce somewhat out of the box? I'm just trying to get a better understanding on how long does it take from the conversation with customers and sort of scouting out what they're going to do, getting their data in order and then bringing sort of Agentforce to bear, is it a three, six-month process? Just trying to get a sense if you have an idea on that quite yet. Thanks.

Yeah. It's a great question, Kirk, and I appreciate it. It varies by customer, honestly. If you've had a very strong data architecture strategy for many years, your ability to turn on Data Cloud, harmonize your data, and leverage it in our AI solutions is months and weeks even. There are other customers who have data siloed across their business. They've built data lakes; it sits across different divisions that they want to bring together in Data Cloud, and that can take a bit longer, six months even to bring that data together. They all want to move faster, which is the great opportunity for us. They all recognize the need for harmonized data to make their AI and their Agentforce opportunity better with their customers. And so what we're seeing is tremendous demand for not only the technology, but the people to go harmonize the data, get it in a state that they can now leverage Agentforce to really deliver for their customers. So it really depends, honestly, is the answer.

Thanks, Kirk, and thanks everyone for joining the call today. We look forward to seeing everyone over the coming weeks and wish everyone a Happy Holiday season.